I like to think of it in terms of psychological reaction. Anticipate the masses anticipate the market
The forex market is very vast so it is not easy to guess how and what makes market move. Also the fact that there ae big international competitors competing with each other.
And yes, demand and supply is another factor into this.
Have sense in this.
Agreed on this demand and supply thing @no_frame
Supply curve of foreign exchange slopes upwards due to positive relationship between supply for foreign exchange and forex rate, which means that supply of foreign exchange increases as the exchange rate increases.
From what I understand it is simply areas of liquidity. These are a magnet for price for the big guys to fill their orders. Either jump on board or be the liquidity for them.
You are right here. The effect of institutional players is extremely high, that is why it is important to use risk and money management in your trading. Everything might happen on the market irrespectively of pattern and other indicators and a trader should definetely secure their risks.
There is no single factor in moving the market. There are key players such as banks and institutions that strongly impact the market. Other factors like political movements, global trade, government policies, and other socio-economic factors also change the look of the market. Understanding all the factors, combined with technical analysis, is must to become a good trader.
People doing business makes the market move. Study and track the things that interrupt normal business cycles. Interruptions change price behavior
What I have recently studied is that Forex markets are dramatically moved by Central banks with monetary policy, exchange regime conditions, and, in unusual cases, currency intervention.
I feel its institutional money and banks repricing along with Fundamentals in the mix.
Areas of liquidity resting above highs and lows that cause fakeouts its all big players
So many factors make the market move
There are many factors that play a vital role in the movement of the market:
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Interest And Inflation Rates
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Current Account Deficits
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Government Debt
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Economic Performance
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Recession
Perfect answer !!!
Big players don’t look charts, they pump and shrink liquidity by playing on Psychological levels.
The inner mechanics that make the forex market move are not exact because the market fluctuates on multiple factors. Trading actions by banks and other bigger corporations have a strong impact. Changes in buyers and sellers also result in the price movements. Other movements such as political state of the world, global trade, monetary policies, and other socio-economic factors are also critical. No one can fully predict these, traders can get any idea of the market state if they do quality fundamental analysis.
The market is moved by central banks and not by institutional traders. Institutional traders are generally correct with the longer term trend as they also need to make money. However the central banks put the most volume ( orders ) into the financial market.
Us retailers are not their target. We are too small. However learning how the central banks trade is a must. This is why typical retail trading tends to fail.
Institutional players and banks repricing and moving price creating liquidity shrinking it to profit from
Stock prices change everyday by market forces. By this we mean that share prices change because of supply and demand. If more people want to buy a stock (demand) than sell it (supply), then the price moves up. Conversely, if more people wanted to sell a stock than buy it, there would be greater supply than demand, and the price would fall.
Understanding supply and demand is easy. What is difficult to comprehend is what makes people like a particular stock and dislike another stock. This comes down to figuring out what news is positive for a company and what news is negative. There are many answers to this problem and just about any investor you ask has their own ideas and strategies.